NexPoint Residential (NYSE:NXRT)
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3 Months : From Aug 2019 to Nov 2019
DALLAS, Aug. 13, 2019 /PRNewswire/ -- NexPoint Residential Trust, Inc. ("NXRT" or the "Company") (NYSE: NXRT) entered into an agreement (the "Agreement") to purchase a 1,520-unit multifamily property located in Pembroke Pines, Florida, a suburb of Miami (the "Pembroke Apartments"), from an unaffiliated third party for approximately $322.0 million, subject to prorations and other adjustments as described in the Agreement. As of July 29, 2019, the Pembroke Apartments were 96.1% occupied with a weighted average effective monthly rent of $1,487.
The purchase of the property is subject to customary closing conditions set forth in the Agreement. The Agreement also contains customary representations and warranties and covenants of the parties. The purchase of the Pembroke Apartments is expected to close on August 30, 2019. There can be no assurance that the closing conditions will be satisfied or that the purchase will be consummated.
The Company has also entered into an agreement to purchase a 346-unit multifamily property located in Nashville, Tennessee ("Arbors of Brentwood"), from an unaffiliated third party for $62.3 million, subject to prorations and other adjustments.
As a result of these acquisitions, NXRT is increasing its Full Year 2019 Core FFO Guidance by $0.02 to $1.92 per diluted share at the midpoint.
A presentation that includes additional information regarding the purchase of the Pembroke Apartments, Arbors of Brentwood and NXRT's revised full year 2019 guidance can be found under "News & Presentations" in the Investor Relations section of the Company's website (www.nexpointliving.com).
NexPoint Residential Trust is a publicly traded REIT, with its shares listed on the New York Stock Exchange under the symbol "NXRT," primarily focused on acquiring, owning and operating well-located middle-income multifamily properties with "value-add" potential in large cities and suburban submarkets of large cities, primarily in the Southeastern and Southwestern United States. NXRT is externally advised by NexPoint Real Estate Advisors, L.P., an affiliate of Highland Capital Management, L.P., a leading global alternative asset manager and an SEC-registered investment adviser.
Cautionary Notice Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on management's current expectations, assumptions and beliefs. Forward-looking statements can often be identified by words such as "expect," "intend" and similar expressions, and variations or negatives of these words. These forward-looking statements include, but are not limited to, statements regarding the expected closing of the Pembroke Apartments acquisition, if at all. Forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward-looking statement. Readers should not place undue reliance on any forward-looking statements and are encouraged to review the Company's Annual Report on Form 10-K for the year ended December 31, 2018 and the Company's other filings with the Securities and Exchange Commission for a more complete discussion of the risks and other factors that could affect any forward-looking statement. Except as required by law, the Company does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changing circumstances or any other reason after the date of this press release.
Non-GAAP Financial Measures
This presentation contains non-GAAP financial measures. A "non-GAAP financial measure" is defined as a numerical measure of a company's financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with GAAP in the statements of income, balance sheets or statements of cash flows of the Company. The non-GAAP financial measures used within this presentation are funds from operations attributable to common stockholders ("FFO"), FFO per diluted share, Core FFO, Core FFO per diluted share and adjusted funds from operations attributable to common stockholders ("AFFO") and AFFO per diluted share. FFO is defined by the National Association of Real Estate Investment Trusts ("NAREIT"), as net income (loss) computed in accordance with GAAP, excluding gains or losses from real estate dispositions, plus real estate depreciation and amortization and impairment charges. We compute FFO in accordance with NAREIT's definition. Our presentation differs slightly in that we begin with net income (loss) before adjusting for amounts attributable to (1) noncontrolling interests in consolidated joint ventures and (2) redeemable noncontrolling interests in NexPoint Residential Trust Operating Partnership, L.P.; we show the combined amounts attributable to such noncontrolling interests as an adjustment to arrive at FFO attributable to common stockholders. Core FFO makes certain adjustments to FFO, which are either not likely to occur on a regular basis or are otherwise not representative of the ongoing operating performance of our portfolio. Core FFO adjusts FFO to remove items such as acquisition expenses, casualty-related expenses/(recoveries), losses on extinguishment of debt and modification costs (includes prepayment penalties incurred and the write-off of unamortized deferred loan costs related to the retirement of debt and costs incurred in connection with a debt modification that are expensed), the amortization of deferred financing costs incurred in connection with obtaining short-term debt financing, the ineffective portion of fair value adjustments on our interest rate derivatives designated as cash flow hedges, and the noncontrolling interests related to these items. AFFO makes certain adjustments to Core FFO. There is no industry standard definition of AFFO and practice is divergent across the industry. AFFO adjusts Core FFO to remove items such as equity-based compensation expense and the amortization of deferred financing costs incurred in connection with obtaining long-term debt financing, and the noncontrolling interests related to these items. We believe that the use of FFO, Core FFO and AFFO combined with the required GAAP presentations improves the understanding of operating results of Real Estate Investment Trusts ("REITs") among investors and makes comparisons of operating results among such companies more meaningful. While FFO, Core FFO and AFFO are relevant and widely used measures of operating performance, they do not represent cash flows from operations or net income (loss) as defined by GAAP and should not be considered an alternative to those measures in evaluating our liquidity or operating performance. FFO, Core FFO and AFFO do not purport to be indicative of cash available to fund our future cash requirements. Our computation of FFO, Core FFO and AFFO may not be comparable to FFO, Core FFO and AFFO reported by other REITs. See page 9 of this presentation and our Annual Report on Form 10-K and Quarterly Reports on Form 10-Q for reconciliations of our non-GAAP financial measures.
Revised 2019 Guidance Reconciliation
The following table reconciles our FFO, Core FFO and AFFO guidance to our net income (the most directly comparable GAAP financial measure) guidance for the year ended December 31, 2019 (in thousands, except per share data):
For the Year Ended
December 31, 2019
Depreciation and amortization
Gain on sales of real estate
Adjustment for noncontrolling interests
FFO attributable to common stockholders
FFO per share - diluted (1)
Loss on extinguishment of debt and modification costs
Adjustment for noncontrolling interests
Core FFO attributable to common stockholders
Core FFO per share - diluted (1)
Amortization of deferred financing costs - long term debt
Equity-based compensation expense
Adjustment for noncontrolling interests
AFFO attributable to common stockholders
AFFO per share - diluted (1)
Weighted average common shares outstanding - diluted
For purposes of calculating per share data, we assume a weighted average diluted share count of approximately 24.3 million for the full year 2019.
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SOURCE NexPoint Residential Trust, Inc.